One of the little-recognized and often-overlooked facts about the high cost of health insurance is that states play a significant role in driving up those costs. States also play a role in determining patients’ access to health coverage, doctors and even medicines—with cold and allergy products containing pseudoephedrine being the most recent example.
For more than 40 years states have increasingly mandated health insurers cover specific providers, products and services. The Council for Affordable Texas Health Insurance estimates that there are 2,156 such state mandates nationwide—and that number grows every year, as states seek to impose even more mandates.
While mandates make health insurance more comprehensive, they also make it more expensive, just as a new car loaded with options is going to be more expensive than the basic model.
To be fair, the vast majority of state legislators are acting honorably and trying to serve their constituents when they propose such mandates. But they also make health care more complicated, while pricing millions of Americans out of the health insurance market.
However, a new type of mandate is emerging that may initially appear different, but it can have a similar impact: the effort in Kentucky, Indiana and Kansas to have some over-the-counter drugs reclassified as prescription only.
The problem some legislators are facing is the abuse of the drug pseudoephedrine, the active ingredient in a number of cold medicines. If criminals are able to get the drug in sufficient quantities, they can illegally process it into methamphetamines, or “meth,” a particularly devastating drug used by low-income populations.
In an effort to control access to the drug, Congress passed the Combat Methamphetamine Epidemic Act in 2005, which (1) requires over-the-counter products containing pseudoephedrine, ephedrine and phenylpropanolamine to be kept locked up behind the pharmacist’s counter, (2) limits how much one can purchase, and (3) requires the purchaser’s identification and signature—all common-sense steps intended to preserve consumer access while reducing crime.
Criminals try to get around the current restrictions by paying people to buy the product and by other means. As a result, 12 states have moved to an electronic-tracking system that alerts pharmacists so they can stop people from buying more than the legal limit of pseudoephedrine.
But two states, Mississippi and Oregon, decided to go a step further and mandate that products with pseudoephedrine be sold by prescription only. Those states are now touting their actions, and other states are considering joining them.
Kentucky’s interest is surprising. It joined seven other states in the mid-1990s imposing numerous mandates on the state’s health insurance system, driving up premiums and driving health insurers out of the state. Kentucky legislators learned their lesson and eventually repealed several of those laws, and the health insurance system revived.
Ditto Indiana. Under Governor Mitch Daniels the state has moved to the forefront of embracing what’s known as consumer-driven health care, which seeks to empower consumers, rather than insurers, to make value-conscious health care decisions.
Yet now both states are considering making it harder for consumers to get the products and services they need, and driving up the cost of health insurance to boot.
Parents know the problem well. A child who is prone to getting earaches has to be taken to a doctor in order to get a prescription antibiotic. The generic drug may only cost $4.00, but the doctor’s visit may cost 20 times that much. While requiring a prescription may be a good policy with regard to antibiotics, does it make sense to force a person with a cold—which in most cases the doctor can do nothing about—to also incur a doctor’s fee just to get a standard cold medication?
And once legislators make pseudoephedrine products prescription only, there will be an expectation—and probably lobbying efforts—to make health insurance pay for it. Will state legislators then feel compelled to mandate that health insurance cover those drugs? Will patients have to wait until Monday to get a prescription if the cold hits on a Friday evening? Or bypass the family doctor, who is off for the weekend, and head to the more-expensive acute care clinic?
That effort is going in exactly the opposite direction of the trend toward more consumer empowerment, giving patients more information and more control over their health care dollars—through Health Savings Accounts (HSAs) and Health Reimbursement Arrangements (HRAs)—and letting them make informed choices.
Yes, there is a problem with meth, but the answer isn’t to make it more difficult and expensive for law-abiding patients to get the products they need. The answer is to make it harder for criminals to commit crimes. Crime-fighting technology, not new mandates on the health care system, is the best way to address the problem.